Physician Hospitals of America announced the U.S. Court of Appeals for the Fifth Circuit in Houston will hear an argument tomorrow against the Patient Protection and Affordable Care Act's restriction on physician-owned hospitals.

Hoag Orthopedic Institute, a physician-owned orthopedic hospital in Irvine, Calif., opened just in time to meet the deadline set forth by healthcare reform. The idea for Hoag Orthopedic Institute was formulated around three years ago as a for-profit joint venture between a not-for-profit community hospital, Hoag Memorial Presbyterian Hospital, and 35 orthopedic surgeons from two different orthopedic groups. The hospital was built and opened in Nov. 2010, with 51 percent ownership going to the hospital and 49 percent going to the physicians. However, the governance of the institution is 50-50, and it's run by physicians.